INTRODUCTION

The delivery channels include direct dialup connections, private networks, public networks, etc.
with the popularity of computers, easy access to Internet and World Wide Web (WWW), Internet
is increasingly used by banks as a channel for receiving instructions and delivering their products
and services to their customers. This form of banking is generally referred to as Internet Banking,
although the range of products and services offered by different banks vary widely both in their
content and sophistication. The Internet has revolutionized the way we live, shop, entertain and
interact and also the way we save and invest. Internet banking arrived in India in the late 1990s
[1]. ICICI was the first bank to champion its usage and introduced internet banking to its
customers in 1996. With lower internet costs and increased awareness about electronic media,
online banking established itself only in 1999. Other banks followed suit, including HDFC,
Citibank, IndusInd and the now redundant Times Bank [2]. Internet banking changed both the
banking industry as well as banks services to its customers. Anywhere banking came to be
recognized as an opportunity also for differentiated and competitive services. Ancillary online
services like checking account status, fund transfer, ordering demand drafts, loan applications,
credit card verifications, shopping portals etc. as well as not requiring a visit to the branch during
office hours were viewed as high-value offerings and increasingly started to become a necessity
rather than a service. Once banking institutions recognized the low processing cost per
transaction via the internet, they began viewing online banking as an extension of the bank rather
than as an add-on service. The motivation to introduce online banking now also included new
business potential, additional funds from new and existing customers, expansion in geographical
reach, image as a tech-savvy bank especially if targeting the youth and the threat of customers
shifting loyalty if they did not introduce it [3]. Nationalized banks initially viewed online
banking as insecure and counterintuitive and were therefore hesitant. But eventually, SBI, Canara
Bank, Allahabad Bank, Punjab National Bank, Bank of Baroda, Syndicate Bank and others
introduced it. SBI launched internet banking in 2001 and experienced good response. In general,
internet banking saw an exponential rise in users [4]. Today, banks encourage their customers to
use online banking. Besides cost and revenue impacts, this paradigm shift is because they also
recognize that self-control transactions have greater potential for customer satisfaction and
retention. Online banking has thus come to be among essential banking services. The approach to
adopting online banking however is often to